Young Start-Ups Replace Aging Banks In The UK

“The whole idea of bank payments is broken; there’s an opportunity here, and we’re looking to grab it.”, said Hiroki Takeuchi, speaking to the New York Times. Mr Takeuchi is a 26 year old who abandoned his career at some of the world’s greatest banks to create his own payment solution – Go Cardless. Go Cardless is a payment platform that enables its users to take online payments online using the UK’s Direct Debit infrastructure.

Go Cardless is one among many new start-ups cropping up in East London and providing alternatives bank’s outdated payment solutions and feeding customers’ new needs. According to the NYT, it all started with Wonga.com, a company that offers short-term, high-interest loans since 2006. The success of Wonga has pushed many to create their own businesses. Two examples are Market Invoice and TransferWise – two start-ups offering different financial services, which are not being offered by banks.

But Canary Wharf has taken the hint and is opening a center for start-ups at the 39th floor of One Canada Square. Level39 will welcome start-ups looking to developed financial services technology. Speaking to ComputerWeekly.com, Level39 head, Eric Van Der Kleij said: “We will partner with the world’s best FinTech investors, incubators and accelerator programmes to support businesses as they progress from start-up through to expansion and growth stages. This will be a place for industry experts to come together, share knowledge and develop up and coming talent with a view to bringing new products and services to the market.”

The tax and legal regimes in the UK is one of the best in the world for startups – it is only natural that along with that and growing demand from customers who no longer trust the big players start-ups continue to populate London’s East End. Even the government has taken on this change. Prime Minister David Cameron contributed to the acceleration of the East London Tech City project, which will soon be headed by former vice president and managing director of Facebook’s Europe, Middle East and Africa operations, Joanna Shields. London can combine its position as Europe’s financial center and start-up friendly hub to welcome innovative financial entrepreneurs.